In an obvious criticism meant for retailers such as CompUSA, Circuit City, and Sears, Apple Chief Executive Officer, Steve Jobs, told a crowd of independent Apple dealers last Thursday that the computer buying experience is worse than purchasing a car. In addition, Jobs would neither confirm nor deny news that Apple would soon open retail stores, but defended such a move saying, “this is America.”
The comments by the flamboyant co-founder came last Thursday during a three-hour meeting with independent dealers during Macworld Expo in San Francisco, of which Jobs spent a little more than an hour with the packed room of over 300 people.
Dealers in attendance told MacCentral that Jobs was colorful in his words and language, often uttering strong profanities to prove his point and show his anger at the problems his company faces on a consistent basis.
The chief executive answered many questions from the crowd of dealers, which were surprised to hear from the computer leader who hasn’t spoken to them directly in well over five years.
Jobs was candid in his comments, beginning his unscripted speech with an overview of direction for the company and its products and often discussing strategy as it pertains to sales and marketing — topics near and dear to dealers who continue to struggle with slim profit margins and escalating competition directly from the company they purchase product from.
He concentrated much of his address to the “customer experience” at retailers such as Circuit City, telling the dealers that, “buying a car is no longer the worst purchasing experience. Buying a computer is now number one.”
Jobs explained that customers looking at buying a Mac are not getting the support and adequate demonstration they deserve and as a result, are not buying a Macintosh. Jobs gave only one example of a specific retailer — that of Circuit City — in which Apple had verified customer experiences where sales people had deliberately steered customers from the Apple store-within-a-store area and toward Windows-based products. Jobs called such situations “unacceptable.”
The comments regarding a bad customer experience were meant to prove the appreciation Jobs has for the independent Macintosh dealers, whom he categorized as the one customer experience he deems satisfying. Jobs told one dealer after his speech, “I know I can trust that independent dealers care about their customers and know how to sell and demonstrate a product. I’m not sure major retailers know or care.”
“He was mad about what customers go through to buy a Mac,” another dealer told MacCentral, who asked not to be identified. “I can’t tell you how many times he used the ‘f’ word.”
Speaking as he did in November about Apple’s untimely change in education strategy which resulted in lackluster sales to school systems, Jobs said, “We f—– up. We f—– up big time.”
“I remember dealers looking at each other around the table as he spoke just laughing and realizing what we were witnessing was something we’ve never seen before and might never see again,” the dealer told MacCentral.
When asked about reports that Apple would open retailers locations later this year, Jobs would neither confirm nor deny the reports. Later, when one dealer commented that it wasn’t fair for them to have to compete directly with Apple, Jobs’ only response was, “this is America.”
Jobs seemed perturbed upon learning from dealers that they are not allowed to reprint Apple ads or use Apple television commercials in their own advertisements — a practice enacted years ago by Mitch Manditch, recently departed Senior Vice President of Worldwide Sales. Jobs said he would investigate the policy, but couldn’t guarantee it would change anytime soon.
The CEOs comments regarding poor customer experiences at major retailers comes at a delicate time for one company Apple uses to promote, market and train sales people at CompUSA — MarketSource Corp. The Cranbury, New Jersey-based marketing and promotional company has had a contract with Apple for close to five years now providing fulltime and part-time ‘out-sourcing’ at all of Apple’s major retailers.
The contract with MarketSource is up for renewal later this year, MacCentral has learned, and executives at Apple are reportedly questioning the validity of the programs importance, if not the direction of its mission. Both companies are presently in discussions regarding a contract renewal.